Google: Ukraine-Russia War Drove Down Western European Ad Spending

Top executives at Google parent Alphabet said they remain “deeply concerned” about the war in Ukraine and the humanitarian crisis in the region, and they are doing their part to help.

While in Warsaw, Poland, last month, Sundar Pichai, Alphabet and Google CEO, met with leaders across Central and Eastern Europe to reaffirm the company’s commitment to the region.

“We are finding ways for our products and platforms to be helpful, including enhanced features on Search to help refugees find resources,” he told investors and analysts during the company’s Q1 2022 earnings call Tuesday.

Throughout the call, Alphabet executives reported “volatility” during the end of the third quarter after suspending advertising and other services in Russia early in March.

Alphabet CFO Ruth Porat said to expect that second quarter results will continue to reflect “repercussions” from the war, but that it’s too early to provide more insight into the outcome.



The executives said that from the start of the war, Google experienced a pullback in ad spending, particularly on YouTube in Europe. Only about 1% of Google's revenue came from Russia in 2021, primarily from advertising.

The war had an “outsized impact” on YouTube ads relative to the rest of Google, a reduction in spend primarily by brand advertisers in Europe.

Revenue growth in the European region, including the Middle East and Africa, slowed to 19% in the first quarter from 33% a year earlier.

First quarter worldwide revenue rose to $68 billion, up from $55 billion a year ago. Google Search and other revenue contributed $39.6 billion, up from $31.8 billion in the year-ago quarter. YouTube ads saw steady growth to nearly $7 billion, up from $6 billion. And Google’s network brought in nearly $8.2 billion, up from $6.8 billion.

Despite the pullback, YouTube Shorts now averages more than 30 billion daily views, up four times compared with a year ago, based on services such as video editing introduced in the first quarter.

The living room has become another opportunity to reach consumers. On average, viewers watch more than 700 million hours of YouTube content on televisions every day, the company reported during the call.

Soon YouTube's connected TV viewers will gain smartphone control navigation and interactivity features, allowing people to comment and share content watch on television directly from their devices.

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